LAND TRANSPORT SERVICES-Part 03

13.With respect to buses the
following table, taken from the same World Bank study, gives a geographically
diversified overview of the forms of management and the general economics of
the sector.

Table 4

Bus Services: City Comparisons, 1983a,b

City

Ownership

Number of busesc

Availability %

Km. per
operating bus per day

Staff per
operating bus

Passengers per operating bus per day

Annual operating
cost

(US$ million)d

Total cost per
passenger/kme

Annual operating
revenue (US$ million)f

Typical fare per
5 km. (US$)

Operating revenue/total
costs ratioe

Abidjan

Mixed

1,044

85

183

7.1

829

91.29

0.07

69.40

0.26

0.67

Accra

Public

44

24

292

28.1

2,092

1.03

0.03

0.63

0.13

0.51

Accra

Private

665

73

223

5.5

676

10.43

0.04

17.72

0.18

1.37

Addis Ababa

Public

164

58

205

13.1

2,467

7.96

0.02

6.59

0.07

0.67

Ankara

Public

899

67

210

5.8

1,273

25.62

0.01

15.31

0.14

0.48

Bombay

Public

2,325

92

216

14.0

2,093

81.95

0.01

72.97

0.05

0.77

Cairo

Public

2,454

69

246

14.6

2,417

60.41

0.01

36.19

0.07

0.50

Calcutta

Public

981

64

133

18.0

1,641

23.05

0.01

13.09

0.04

0.45

Dakar

Mixed

439

70

287

9.6

1,193

22.97

0.04

20.41

0.26

0.76

Guatemala

Private

1,600

95

304

..

1,037

29.00

0.02

54.60

0.10

1.55

Hong Kong

Private

2,392

85

243

4.7

1,610

117.96

0.03

136.10

0.13

1.00

Karachi

Public

646

65

267

9.9

1,135

11.73

0.01

6.73

0.04

0.43

Kuala Lumpur

Private

358

80

250

4.3

753

12.03

0.02

12.38

0.17

1.00

Mombassa

Mixed

89

90

315

7.5

1,640

3.93

0.03

4.48

0.11

0.96

Nairobi

Mixed

295

84

330

9.7

1,762

16.31

0.03

17.98

0.15

1.08

Porto Alegre

Private

1,492

95

218

4.3

669

46.68

0.05

65.35

0.23

1.17

San José

Mixed

621

80

128

..

2,013

19.39

0.02

24.24

0.07

1.04

San Paulo

Public

2,631

83

284

7.4

795

159.51

0.03

75.64

0.26

0.41

San Paulo

Private

6,590

83

280

5.1

765

..

..

..

0.26

1.00g

Seoul

Private

8,310

95

340

3.9

1,326

398.18

0.03

443.43

0.16

1.04

Singapore

Private

2,859

91

269

3.9

374

110.23

0.10

147.75

0.24

1.32

Athens

Public

1,768

87

245

6.6

910

100.36

0.05

37.39

0.23

0.34

Berlin (west)

Public

1,505

85

199

5.8

992

234.99

0.16

130.08

0.78

0.51

Chicago

Public

2,275

93

125

3.1

750

339.28

0.08

194.54

0.90

0.52

London

Public

4,901

88

202

6.8

842

605.90

0.17

319.21

0.61

0.48

Paris

Public

4,005

87

142

4.5

419

512.00

0.25

191.45

0.30

0.37

Sendai

Public

777

92

128

2.5

495

57.76

0.11

59.44

0.58

0.96

a Two dots (..) indicate that data are not available
or are not separately reported.

b Covering principal corporation or group of private
operators in each city and not including paratransit.

c Number of buses belonging to the principal
corporation or group of private operators covered by the survey.

d Excluding depreciation and interest charges.

e Including
operating costs, depreciation and interest charges. For comparative purposes, a uniform method of
calculating depreciation and interest charges has been used to obtain total
costs. Passenger/km. are imputed using
an average trip length of 5 km.

f Including fare box and advertising revenue, but
excluding subsidies.

g Cost and revenue data for San Paolo private
operators are not available; however,
private operators receive no public subsidy and are known to at least break
even.

It
will be noted that the services are often operated on a mixed or public basis,
particularly in the developed countries (the entry for London needs updating,
however, since urban transport was partly deregulated in 1994 with the
introduction of a system of concessions granted to private or public companies
requiring less in the way of subsidies[1]). There is a very marked disparity in the rates
of utilization of the fleet, productivity, cost per passenger and fares. Operation seems to be profitable in only
eight cases out of 27, seven of these eight operations being private (all
profitable in the sample) and one mixed.
However, information is lacking with regard to the size of the networks
and whether there are any public service obligations or, on the contrary, the
networks are free to "cream off" the best routes. It also emerges that this activity is
particularly unprofitable in the developed countries. Local bus services, which peripherally may be
extra-urban or even interurban (and thus fall in another heading of the CPC),
must meet similar economic and regulatory requirements.

15.As in the
railway sector, the system of concessions and delegated management is tending
to spread both in the developed countries, keen to limit their subsidies and
hence rely on the lowest bidder[2],
and in the developing countries where it is being encouraged by the World
Bank. Moreover, this semi-private
management system is not incompatible with the frequent unprofitability of the
activity to the extent that the concession contract provides for balancing subsidies. These concessions are more a matter of
government procurement than market access.

16.Trams and,
to a lesser extent, trolley-buses are making a comeback. The infrastructure costs for a tramway range
from 6 million dollars per kilometre to 110 million dollars per kilometre (in
the case of tunnels and an exclusive right of way) and a tram set costs
approximately 6 million dollars. In view
of these costs, it seems unlikely that there are any cases of this mode of
transport being operated on a purely private basis. Concessions, however, are possible.

17.Finally,
it should be noted that from a legal and technical standpoint the difference
between a subway and a tramway is sometimes rather tenuous: thus the same "light rail vehicle"
will be classified as part of the road transport system if the rails are laid
along the public way as in Hanover or Strasbourg and as part of the rail
transport system if it runs along its own exclusive right of way like the Val
de Lille or the Sydney monorail, for which a concession was recently granted,
the definition of rail transport in the CPC (CPC 71112) including "urban
mass transit railways (underground or elevated railways)".

18.Except
where the city is situated close to the frontier, as in the case of Geneva,
Strasbourg or Basle, mode 1 has no relevance in urban transport. Moreover, there is no restriction in mode 2
and mode 4 seems marginal. Thus, most of
the trade falls in mode 3 in so far as the activity is open to foreign natural
persons or foreigners are authorized to acquire majority holdings in urban
transport companies or establish such companies. In this sector the problems of government
procurement for concessions seem at least as, if not more important than, those
of market access.

[1] For a detailed analysis of the effects of deregulation of the local
bus services in the United Kingdom see Helen Lawton Smith "Deregulation
and Privatization in the UK Freight, and Buses and Coach Industries",
Tokyo, discussion paper No. 60, Economic Research Institute, Economic Planning
Agency op. cit. in S/C/W/26/Add.1, 29
May 1998, "Economic Effects of Services Liberalization: Overview of the Empirical Studies".

[2] See, for example, "Competition Policy and Deregulation of Road
Transport", OECD 1990, in which the OECD's Committee on Competition Law
and Policy advises against the internal adjustment of tariffs (cross
subsidization) and recommends the identification of costs and the organization
of tender procedures to ensure that non-economic services are awarded to the
lowest bidder in terms of subsidies.